ISLAMABAD – Pakistan reportedly reached an agreement with Moscow to import crude oil at discounted rates, starting January 2025, and the upcoming deal is expected to benefit Pakistan’s refineries, with profits from the discounted oil to be reinvested in upgrading refinery infrastructure.
The decision was made during the Inter-Governmental Commission (IGC) meeting in Russian capital, where both nations agreed to resume the oil trade under government-to-government (G2G) arrangement, per reports.
Under the new understanding, Pakistan Refinery Limited (PRL) will import one cargo of Russian crude oil per month, totaling 12 cargos in a year. Pakistani delegation led by Federal Minister for Power Sardar Owais Ahmad Khan Leghari also sheds light on several aspects of the agreement.
During this negotiations, SBP Governor played crucial role in negotiating payment mechanisms, ensuring the establishment of a reliable system for smooth transactions between Islamabad and Kremlin.
Pakistan State Oil (PSO), which holds around two third stakes in PRL, will oversee the import process and government holds 32% of PRL’s shares, while the remaining part is owned by the public and various investment entities.
This new arrangement is expected to strengthen economic ties between two nations, marking the start of new phase in bilateral trade. Inter-Governmental Commission (IGC) meeting also covered other key topics, including rail connectivity between Pakistan, Central Asia, and Russia, the completion of the $3 billion Pakistan Stream Gas Pipeline (PSGP) project, and measures to boost trade between the two nations.
For the unversed, first shipment of 100,000 tons of crude oil from Russia, which arrived at Oman’s Duqm port in June 2023, was transferred to two smaller vessels for delivery to Pakistan.
